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  • Red 5 (RED) has successfully completed a $125 million share placement to support the development of the King of the Hills gold mine in Western Australia
  • Almost 695 million shares were issued to sophisticated and professional investors at a price of 18 cents per share
  • The Board of Red 5 will provide $470,000, subject to shareholder approval
  • Money raised will be used to support ongoing operation and exploration activities at King of the Hills, and general working capital
  • Red 5 has slumped 21.3 per cent on the market and shares are trading for 18.5 cents each

Red 5 (RED) has successfully completed a $125 million share placement to support development of the King of the Hills gold mine.

Almost 695 million shares were issued to sophisticated and professional investors at a price of 18 cents per share and the placement was oversubscribed as both new and existing shareholders participated.

The placement was undertaken in two phases, with the first phase issuing 171.5 million shares to raise $30.87 million.

Following shareholder approval, phase two will issue the remaining 522.94 million shares to raise $94.13 million, and this is expected to settle on May 12.

These dates indicate when the shares are expected to be delivered and become the legal property of shareholders.

Of this $94.13 million, the Board of Red 5 will provide $470,000 in Phase two, however, this is subject to shareholder approval.

“This strong outcome reflects the market’s confidence in the growth pathway we have mapped out, which will see Red 5 evolve into a multi-asset, mid-tier gold producer over the next two years,” Managing Director Mark Williams said.

“The completion of this placement puts us in a strong position to transition efficiently into project development following the completion of the bulk mining final feasibility study in the September 2020 quarter,” he added.

Money raised will be used to support the ongoing operation and exploration activities at King of the Hills, and as general working capital.

King of the Hills is located 80 kilometres south of Red 5’s Darlot Gold Mine and 28 kilometres north of Leonora in the Eastern Goldfields region of Western Australia.

Mining at King of the Hills has traditionally focused on extracting high-grade gold veins.

However, since Red 5 began operations in January 2018, the potential to extract significant qualities of lower-grade gold mineralisation, which is located between high-grade veins, has been identified.

Red 5 has slumped 21.3 per cent on the market and shares are trading for 18.5 cents each at 12:06 pm AEDT.

RED by the numbers
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